Request for Equitable Adjustment (REA)
Also known as: REA, request for equitable adjustment
What you do here: Document the impact and formally request the price/time adjustment before it becomes a claim
At a Glance
- Who submits it
- The contractor, to the contracting officer
- What it does
- Formally requests an equitable adjustment with supporting cost/schedule data
- Governing authority
- FAR 43.204 (change order accounting/negotiation); the Changes clause
- Vs. a claim
- An REA seeks negotiation; a CDA claim demands a final decision and starts interest
- Certification
- May require a certification (DFARS adds one over a threshold); a CDA claim over $100,000 must be certified
What It Is
A Request for Equitable Adjustment (REA) is the formal, documented request a contractor sends the contracting officer asking to be made whole for the cost and schedule impact of a change or a government-caused problem. It is the ordinary, business-like way to pursue an equitable adjustment: you describe what happened (the change order, the differing site condition, the delay), tie the impact to the contract, quantify the added cost and time with supporting data, and ask the contracting officer to negotiate a bilateral modification. An REA is fundamentally a negotiation document. That distinguishes it from a claim under the Contract Disputes Act, which is a formal demand for a contracting officer's *final decision* — a claim starts the interest clock, triggers strict decision timeframes, requires certification above $100,000, and opens the door to appeal at a board of contract appeals or the Court of Federal Claims. Many disputes are resolved as REAs without ever becoming claims. The sequence matters: you generally try the REA first, and convert to a certified claim only if negotiation stalls. (Note that DFARS imposes its own certification on REAs above a dollar threshold, and REA preparation costs are treated differently from claim-prosecution costs.)
When You See It
- After a change order or constructive change, to quantify and request your equitable adjustment.
- When a differing site condition, suspension, or government delay increased your cost or time.
- Before escalating to a formal Contract Disputes Act claim — the REA is the negotiation step.
- Whenever you want the contracting officer to negotiate an adjustment rather than issue a final decision.
Key Features
| Feature | What It Means |
|---|---|
| A negotiation document | An REA asks the contracting officer to negotiate an adjustment; it is not a demand for a final decision and doesn't itself start CDA interest. |
| Must be documented | A persuasive REA ties the impact to the contract and supports the cost and schedule numbers with real data, not estimates. |
| Precursor to a claim | Many disputes start as an REA; if negotiation fails, the contractor can convert it into a certified CDA claim. |
| Certification wrinkles | DFARS requires a certification on REAs above a threshold; a CDA claim over $100,000 requires a different, statutory certification. |
| Cost recovery differs | The cost of preparing an REA can be an allowable contract-administration cost, while the cost of prosecuting a CDA claim generally is not. |
The SDVOSB Angle
For an SDVOSB, the REA is usually the right first move — it keeps the relationship with the contracting officer businesslike and avoids the cost and formality of litigation. Build it like a mini-proposal: a clear narrative of the change, a tight cost build-up, and schedule analysis. Small firms lose recovery two ways — by waiting too long (blowing the Changes-clause notice window) and by under-documenting. If the contracting officer won't negotiate a fair adjustment, know that you can convert the REA into a certified Contract Disputes Act claim to force a final decision and start interest running; keep the two straight, because the certification, cost-recovery, and appeal rules differ.
How to Handle It
- Give timely written notice of the impact under the Changes clause, then prepare the REA.
- Write a clear narrative linking the change or government action to the cost and schedule impact.
- Support the numbers with segregated cost data — labor, materials, subcontracts, disruption, extended overhead — and profit.
- Include any required certification (check DFARS thresholds) and submit to the contracting officer for negotiation.
- If negotiation stalls, convert to a certified Contract Disputes Act claim and demand a final decision.
Watch Out For
- Missing the Changes-clause notice window before submitting the REA.
- Submitting a thin, estimate-based REA that the contracting officer can easily discount.
- Confusing an REA with a claim — they have different certification, interest, cost-recovery, and appeal consequences.
- Prosecuting the dispute as a claim without realizing claim-prosecution (litigation) costs are generally unallowable.
Run the Numbers
Frequently Asked
What is a Request for Equitable Adjustment (REA)?
An REA is the formal, documented request a contractor submits to the contracting officer asking for an equitable adjustment to contract price and/or schedule after a change or government-caused impact. It's a negotiation tool: you describe the change, tie it to the contract, quantify the cost and time impact with supporting data, and ask the contracting officer to negotiate a bilateral modification. It is distinct from, and usually a precursor to, a formal Contract Disputes Act claim.
What is the difference between an REA and a claim?
An REA seeks negotiation — it asks the contracting officer to agree on an equitable adjustment. A claim under the Contract Disputes Act is a formal demand for a contracting officer's final decision; it starts interest running, triggers statutory decision deadlines, requires certification if it exceeds $100,000, and can be appealed to a board of contract appeals or the Court of Federal Claims. Contractors typically try the REA first and convert to a certified claim only if negotiation fails. The cost of preparing an REA can be an allowable contract cost, while the cost of prosecuting a claim generally is not.
Does an REA have to be certified?
It depends. A basic FAR REA does not carry the Contract Disputes Act certification, but under DFARS an REA above a dollar threshold requires a specific REA certification. A Contract Disputes Act claim over $100,000 requires the statutory CDA certification. Because the certifications and their legal consequences differ, identify which document you're submitting and include the correct certification — a defective certification can create problems for a claim.
Primary Sources
- FAR 43.204 — Administration (change order accounting, negotiation)
- FAR Subpart 33.2 — Disputes and Appeals
- FAR 52.243-1 — Changes—Fixed-Price
Plain-English reference, not legal advice. Contract modification, options, novation, and termination rules are fact-specific, and the FAR and agency supplements are amended from time to time — always read the current FAR text, follow the notice and certification timeframes in your specific contract clauses, confirm the requirements with the contracting officer, and consult qualified counsel before relying on a modification, settlement, claim, or termination position.
Change log (1)
- LaunchedPublished the federal contract modifications, options & change management reference covering how a federal contract changes after award — the bilateral supplemental agreement and the unilateral modification (FAR 43.103), the change order under the Changes clause (FAR 52.243-1), the administrative change (FAR 43.101), the equitable adjustment and the Request for Equitable Adjustment (FAR 43.204 / 43.205), the constructive change doctrine, the options to extend the term and quantity (FAR 52.217-8, 52.217-9, and the Subpart 17.2 quantity options 52.217-6/-7), the novation and change-of-name agreements (FAR Subpart 42.12), and the terminations for convenience and default (FAR Part 49 / 52.249-2 / 52.249-8) — each with an at-a-glance quick-facts card, a when-you-see-it list, a key-features table, an SDVOSB-specific angle, a how-to-handle-it checklist, watch-outs, FAQPage, Article, Dataset, and BreadcrumbList structured data, primary-source FAR citations, and cross-links into the glossary, regulation explainers, clauses, forms, contract types, protest & dispute forums, compliance deadlines, how-to guides, FAQ, and the limitations-on-subcontracting, price-to-win, size-standard, and set-aside eligibility calculators.